Demographic change (2015-2050): opportunity or challenge?

Despite its small size, Luxembourg is one of the European countries with the highest population growth. In less than a decade, its population has grown by nearly 20%, mainly due to immigration. At the same time, new laws are promoting the acquisition of Luxembourgish nationality by option or naturalization.

This dynamic has shaped Luxembourg into a highly multicultural country. This characteristic is expected to become even more pronounced by 2050. Here, we examine the main demographic trends of the last ten years in Luxembourg and project future developments.

Exceptional and continuous population growth

Over the last ten years, Luxembourg's population has grown impressively. Its population has risen from 560,000 in 2015 to nearly 672,000 in 2024, an increase of 19.4%.

This growth rate, the highest in Europe, is largely fueled by immigration. The share of foreign residents has grown faster than that of Luxembourg nationals. The growth rate of the international population is 22.8%, compared to 16.5% for nationals.

If this trend continues, Luxembourg's population could reach 1.12 million by 2050. This projection takes into account continued immigration, driven by economic opportunities and easier naturalization. Indeed, the 2008 law on dual nationality allows foreign residents to become Luxembourg citizens without renouncing their original nationality.

Asia and Africa, future sources of foreign residents

The composition of foreign residents has changed considerably over the last ten years in Luxembourg. Although Europe remains the main source of immigration, other regions are also significant sources of immigration to Luxembourg. The Asian population, particularly Indians, has tripled. They now represent nearly 4% of the Luxembourg population. In addition, due to armed conflicts in their respective countries, Syrian and Afghan nationals have also seen a sharp increase in the Luxembourg population.

As far as Africa is concerned, the absolute figures remain low. However, nationals from the Maghreb region, particularly Morocco and Tunisia, have made their mark in Luxembourg. Conversely, the Cape Verdean population, which has historically been present in Luxembourg, has declined slightly.

Contrasting dynamics for European communities

Portugal, France, and Italy top the list of new arrivals

Among European communities, Portugal, a long-standing player in immigration for decades, remains in the lead with 90,000 nationals living in Luxembourg. The Portuguese population represents around 15% of the total population.

However, the Portuguese-speaking community has been in slight decline in recent years. This decline could be explained by three factors:

• Access to Luxembourgish nationality,
• Return to their home country. Some Portuguese nationals return to Portugal when they retire. In fact, a residence awaits them. It should be noted that Portugal had introduced a 10-year income tax exemption for new residents.
• Giventhe explosion in real estate prices in Luxembourg, some residents prefer to move to France because it is easier to buy property there.

At the same time, the French and Italian populations are growing significantly, exceeding the national average. Italy is strongly represented in Luxembourg, thanks in particular to the influence of companies such as Ferrero, which attracts many Italian nationals.

As for Eastern European countries, Romania, Ukraine, and Poland have also seen a significant increase in their nationals in Luxembourg. The war in Ukraine has led to a massive influx of Ukrainian refugees to Luxembourg since 2022. This trend is likely to continue in the coming months. Finally, Spain has seen its population in Luxembourg increase by 88%, a particularly remarkable figure.

German-speaking and Nordic countries lag behind

Finally, Belgium and Germany have seen a stagnation in the number of their nationals. This is linked to the number of cross-border workers, which has declined slightly in recent years. These two indicators could explain a decline in Luxembourg's attractiveness to its two neighboring countries. A study on this "potential disenchantment" could be very useful in understanding the long-term effects on the economy of the Grand Duchy, whose profile in terms of mentality and culture remains close to that of Germany. This German trend seems to be mirrored to some extent by the countries of Scandinavia, Switzerland to a lesser extent, and the Netherlands.

Dual nationality law: a key factor in diversification and integration?

The 2008 lawon the acquisition of Luxembourg nationality marked a turning point in Luxembourg's demographics, allowing for increased naturalization of foreign residents.

Between 2009 and 2017, more than 47,296 people acquired Luxembourgish nationality, mainly Portuguese, Belgian, and French nationals. In 2018, 8.8% of Luxembourgish citizens had dual nationality, and this proportion is expected to continue to grow, reaching between 15% and 20% by 2050.

This increase in dual nationality reflects the growing integration of foreign communities, contributing to greater cultural diversity in Luxembourg. By 2050 , the Luxembourg population could include 110,000 citizens with dual nationality, further strengthening the country's cosmopolitan character.

What challenges and opportunities await Luxembourg in 2050?

With such demographic growth and an increasing number of citizens with dual nationality, Luxembourg will face several major challenges by 2050.

A proactive social and cultural integration policy

To continue the social and cultural integration of its many immigrants, Luxembourg will have to keep finding ways to ensure social cohesion in an increasingly multicultural country. Managing this diversity will be crucial to maintaining social peace and economic dynamism.

Major challenges in terms of infrastructure and public services

With a population expected to exceed one million by 2050, Luxembourg is facing pressure on its infrastructure, such as housing, education, and health care. In order to manage this increased pressure, it will be essential for the country to continue investing in these sectors to meet growing demand.

National identity, the authorities' gamble on the future of the Grand Duchy

With a growing proportion of the population holding dual nationality, the question of Luxembourgish identity will be at the center of debate in the coming years. The country will need to find a balance between integrating new citizens and preserving its cultural heritage.

Luxembourg, a model of multicultural diversity in Europe

Projections for 2050 indicate that Luxembourg's population will exceed one million. Given that a significantproportion of this will be citizens with dual nationality, the country will have to rise to the challenge of maintaining economic growth while ensuring the harmonious integration of its residents.

If the Grand Duchy succeeds in overcoming these challenges, it will continue to prosper and serve as an example of diversity management and social cohesion in Europe.

More information on Luxembourg's cosmopolitan, multicultural population